Determining basis of partnership interest

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Reference no: EM13155636

In the current year, Stephanie formed an equal partnership with Jane. Stephanie contributed land with an adjusted basis of $250,000 and a fair market value of $350,000. Stephanie also contributed $100,000 cash to the partnership. Jane contributed land with an adjusted basis of $150,000 and a fair market value of $200,000. The land contributed by Stephanie was encumbered by a $250,000 nonrecourse debt. Assume the partners share debt equally. Immediately after the formation, the basis of Stephanie's partnership interest is:

a. $0.

b. $225,000.

c. $300,000.

d. $325,000.

e. None of the above.

Reference no: EM13155636

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